Abstract
The year 1958 marks a milestone both for international commercial arbitration and European integration. On 10 June 1958 the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention) was adopted by a United Nations diplomatic conference. The New York Convention became the cornerstone of international commercial arbitration and its pro-enforcement bias has facilitated its success in the modern business world. Earlier in 1958, the Treaty of Rome had already entered into force, marking the beginning of what has now become the European Union. The European Union has allowed its Member States to form an economic superpower of unparalleled kind.
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Notes
- 1.
Convention on the Recognition and Enforcement of Foreign Arbitral Awards [1959] 330 UNTS (No 4739), pp. 38ff; see also UN Doc E/CONF. 26/9/Rev. 1 [1958].
- 2.
Lew et al. (2003), para. 2-18. Currently, 153 of the 193 UN Member States as well as three non-UN Member States have adopted the New York Convention.
- 3.
Treaty Establishing the European Economic Community, Rome, 25 March 1957, [1958] 298 UNTS (No 4300) 11ff; Treaty Establishing the European Atomic Energy Community, Rome, 25 March 1957, [1958] 298 UNTS (No 4301), pp. 167 ff.
- 4.
- 5.
Cf. Basedow (1988), pp. 34 f.
- 6.
Shelkoplyas (2003), p. ix.
- 7.
- 8.
- 9.
By one account, arbitrators are confronted with questions pertaining to the application of these provisions in more than 50 % of cases, Blessing (1999), p. 228.
- 10.
Case C-126/97 Eco Swiss v Benetton International [1999] ECR I-3055; Case C-381/98 Ingmar [2000] ECR I-9305; Case C-168/05 Mostaza Claro [2006] ECR I-10421; Case C-40/08 Asturcom Telecomunicaciones [2009] ECR I-9579.
- 11.
Case C-126/97 Eco Swiss v Benetton International [1999] ECR I-3055, para. 41.
- 12.
- 13.
Shelkoplyas (2003), pp. 266 and 272.
- 14.
See infra 78ff.
- 15.
Shelkoplyas (2003), p. 272.
- 16.
Cf. e.g. Beulker (2005).
- 17.
Tribunal de première instance de Bruxelles (Belgium), 8 March 2007, 2005/7721/A, Cytec Industries BV v SNF SAS, YB Comm. Arb. XXXII (2007), 282–283.
- 18.
Cour d’appel de Bruxelles (Belgium), 22 June 2009, 2007/AR/1742, Cytec Industries BV v SNF SAS, Rev. Arb. 2009, 574–575.
- 19.
Cour d’appel de Paris (France), 23 March 2006, SNF SAS/Cytec Industries BV, YB Comm. Arb. XXXII (2007), 282–283.
- 20.
Cour de cassation (France), 4 June 2008, SNF SAS/Cytec Industries BV, YB Comm. Arb. XXXIII (2008), 489–499.
- 21.
This standard can be traced back to Cour de cassation (France), 19 November 1991, Société des Grands Moulins de Strasbourg/Société Compagnie Continentale France, Rev. Arb. 1992, p. 76 (demanding recognition unless the breach of EU competition law renders the award in ‘flagrante et effective’ contradiction to international public policy).
- 22.
Oberlandesgericht Düsseldorf, 21 July 2004, VI Sch (Kart) 1/02, published in excerpts in WuW/E DE-R, pp. 1647ff, full text available on juris-Database (subject to charge) www.juris.de accessed 26 November 2016.
- 23.
ibid para. 24.
- 24.
Oberlandesgericht Thüringen, 8 August 2007, 4 Sch 03/06, SchiedsVZ 2008, p. 44.
- 25.
Among others: OGH (Austria), 23 February 1998, Wirtschaftsrechtliche Blätter 1998, p. 221 (demanding that the breach of EU competition law is ‘evident’ and that no review of the factual findings was permissible); Corte d’Apello di Milano (Italy), 5 July 2006, 1897/06, Terra Armata S.r.l./Tensacciai S.p.A, reported in Landolt (2008), p. 143 (instead of enforcing unless breaches are found, the Milan Court requires awards to provide sufficient and detailed reasoning as to compliance with EU competition law, threatening refusal of enforcement where the reasoning is lacking); Gerechtshof Den Haag (Netherlands), 24 March 2005, Marketing Displays International Inc./VR Van Raalte Reclame B.V, YB Comm. Arb. XXXI (2006) 808–809 (the Court undertook a detailed substantive review); with regard to national competition law: BGH, 23 April 1959, NJW 1438 (finding that the court should also review the factual findings as far as relevant for the result in the award).
- 26.
Cf. e.g. Kasolowsky and Steup (2011).
- 27.
Gaillard (2010b), p. 1ff.
- 28.
These three categories have been developed and outlined by Gaillard; cf. ibid p. 9 for the nomenclature monolocal, multilocal and transnational.
- 29.
The Institute of International Law’s Amsterdam Resolution of 1957 on the International Recognition and Enforcement of Arbitral Awards unequivocally follows the monolocal approach, cf. e.g. Art. 9: ‘The law of the place of the seat of the arbitral tribunal shall determine whether the procedure to be followed by the arbitrators may be freely established by the parties (…)’; cf. also Art. 2 Geneva Protocol on Arbitration Clauses (1923): ‘The arbitral procedure, including the constitution of the arbitral tribunal, shall be governed by the will of the parties and by the law of the country in whose territory the arbitration takes place.’
- 30.
- 31.
Gaillard (2010a), p. 25.
- 32.
The proponents of the multilocal approach criticise the monolocal fixation on the lex fori for violating the parties’ true intention when choosing the seat of arbitration. They stress that the seat of arbitration is often chosen merely out of reasons of geographical accessibility for the parties, available infrastructure for private hearings or other considerations of convenience. The role granted to the lex fori under the monolocal approach has been held to go against the degree of relevance attached to it by the parties when making their choice by Judge Lagergren, cf. Godwin Sarre (1964), p. 271.
- 33.
de Court Fontmichel (2004), p. 205: ‘Arbitrators must comply with the mandatory rules (lois de police) of the State of the seat as well as the mandatory rules (lois de police) of the State of enforcement that claim to apply to the situation. Otherwise their award could be set aside and/or become unenforceable.’, translation by Gaillard (2010a), p. 119.
- 34.
Cf. also Gaillard (2010a), p. 119ff where the negative implications in case of conflicting mandatory rules are underlined. Proponents of the multilocal approach typically meet the potential over-inclusiveness by qualifying the link between the dispute and the respective mandatory rule and by weighing the different interests at stake, cf. Beulker (2005), pp. 288ff, 322.
- 35.
Gaillard (2010a), p. 35.
- 36.
- 37.
For an overview of European countries that have enacted special arbitration laws for international commercial arbitration cf. Poudret and Besson (2007), para. 22.
- 38.
Art. 1506 NCPC (France).
- 39.
Art. 1717 (4) Code Judiciaire (Belgium); cf. also Arts 176 to 194 Bundesgesetz über das International Privatrecht (Switzerland).
- 40.
Poudret and Besson (2007), paras. 31–39.
- 41.
This approach is reflected in Art. 1504 NCPC (France), which provides that an arbitration is international if it involves the interests of international trade.
- 42.
Art. 176 (1) Bundesgesetz über das International Privatrecht (Switzerland) takes up the subjective approach. It makes the application of the Swiss regime designed for international arbitration dependent on the fact that at least one of the parties had neither its domicile nor its habitual residence in Switzerland at the time the arbitration agreement was concluded. Art. 1717 (4) Code Judiciaire (Belgium) provides for a special regime for arbitration proceedings between parties that do not have Belgian nationality or a residence in Belgium. Legal persons are considered Belgian in this sense if their registered office or one of their branch offices is located in Belgium.
- 43.
European Convention on International Commercial Arbitration, Geneva, 21 April 1961, 484 UNTS (No 7041) 349ff. The current ratifying states are Albania, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Burkina Faso, Croatia, Cuba, Czech Republic, Denmark, Finland, France, Germany, Hungary, Italy, Kazakhstan, Latvia, Luxembourg, Former Yugoslav Republic of Macedonia, Moldova, Montenegro, Poland, Romania, Russian Federation, Serbia, Slovakia, Slovenia, Spain, Turkey and Ukraine; for the current status see https://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=XXII-2&chapter=22&clang=_en accessed 26 November 2016.
- 44.
These six Member States are Cyprus, Denmark, Greece, Hungary, Poland and Romania; cf. http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention_status.html accessed 26 November 2016; see generally Hill (2008), para. 7.32.
- 45.
Cf. the definition in n. 2 of the UNCITRAL Model Law on International Commercial Arbitration: ‘The term “commercial” should be given a wide interpretation so as to cover matters arising from all relationships of a commercial nature, whether contractual or not. Relationships of a commercial nature include, but are not limited to, the following transactions: any trade transaction for the supply or exchange of goods or services; distribution agreement; commercial representation or agency; factoring; leasing; construction of works; consulting; engineering; licensing; investment; financing; banking; insurance; exploitation agreement or concession; joint venture and other forms of industrial or business cooperation; carriage of goods or passengers by air, sea, rail or road.’
- 46.
Basedow (2014), p. 337.
- 47.
Cf. regarding this differentiation in the Rome I Regulation, infra 83ff.
- 48.
Basedow (1988), p. 10. The structural reason behind this challenge is that modern conflict of laws rules are all-sided, i.e. they define which law is applicable to certain circumstances. In contrast to this, mandatory provisions embody one-sided conflict rules as they define circumstances in which they deem themselves to be applicable, cf. Mann (1973), pp. 117f.
- 49.
Cf. Michaels (2012), pp. 191ff.
- 50.
E.g. Regulation 833/2014/EU of 31 July 2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine [2014] OJ L229/1.
- 51.
Chambre Arbitrale de Paris, 1 September 2009, YB Comm. Arb. XXXV (2010), 30, 36 regarding Regulation (EC) 178/2002 of 28 January 2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety. Arbitrators found this regulation to reflect considerations of public policy [2002] OJ L31/1.
- 52.
Cf. Art. 115 TFEU and the principle of subsidiarity enshrined in Art. 5 TEU.
- 53.
Directive 1999/44/EC of 25 May 1999 on certain aspects of the sale of consumer goods and associated guarantees [1999] OJ L171/12; see. Riesenhuber (2001), p. 357.
- 54.
Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts [1993] OJ L95/29; cf. Case C-168/05 Mostaza Claro [2006] ECR I-10421; Case C-40/08 Asturcom Telecomunicaciones [2009] I-9579.
- 55.
Directive 2015/849/EU of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC [2015] OJ L141/73; cf. generally Lew (2011); de Lotbinière McDougall (2005).
- 56.
Beulker (2005), p. 336.
- 57.
In ICC Award 9032/1998 and ICC Award 12045/2003 arbitrators had to decide a dispute in which the parties had agreed to apply the Commercial Agents Directive instead of the otherwise applicable transpositions, cf. ICC Award 9032/1998, (2001) 12 ICC Bull. 123; ICC Award 12045/2003, Clunet 2006, 1434, 1435; cf. also the unpublished ICC Awards 7583/1994, 7589/1994 and 8593/1996 referred to by Shelkoplyas (2003), p. 152, n. 19.
- 58.
Directive 86/653/EEC of 18 December 1986 on the coordination of the laws of the Member States relating to self-employed commercial agents [1986] OJ L382/17. For an overview on the developments leading up to the Directive cf. Basedow (1981), pp. 200ff; Saintier (2002), pp. 86–98; Fock (2002), pp. 15–20; Randolph and Davey (2010), pp. 13–17.
- 59.
Shelkoplyas (2003), p. 152.
- 60.
- 61.
Case C-381/98 Ingmar [2000] ECR I-9305; cf. infra 123ff.
- 62.
- 63.
- 64.
Franck (2015), p. 71.
- 65.
Cf. Art. 119 (1) TFEU, cf. also Arts 120 and 127 (1) TFEU.
- 66.
Basedow (2000), p. 21.
- 67.
Cf. Renner (2011), pp. 91–125, 199–304 for an analysis of the application of mandatory law in international commercial arbitration through the lens of system theory.
- 68.
- 69.
E. Posner (1999).
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Engelmann, J. (2017). Introduction. In: International Commercial Arbitration and the Commercial Agency Directive. International Law and Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-47449-6_1
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